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Company issuing $175,000 face value of bonds with a coupon rate of 10%. To help the sale of the bonds, detachable stock warrants should be issued at the rate of one warrant for each $100.00 bond sold.Value of bonds without the warrants is considered to be $136,000 and the value of the warrants in the market is $24,000. The bonds sold in the market at issuance for $150,000.

What entry should be made at the time of the issuance of the bonds and warrants? If the warrants were nondetachable , would the entries be different?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9987626

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